House: Why No Serious Public Safety Spectrum Bids?

A top House Democrat on Tuesday promised a full review of the recently concluded 700 MHz spectrum auction, and called on the Federal Communication Commission (FCC) to review its policies regarding the public safety d-block.

A top House Democrat on Tuesday promised a full review of the recently concluded 700 MHz spectrum auction, and called on the Federal Communication Commission (FCC) to review its policies regarding the public safety d-block.

The FCC's spectrum auction, which sold off valuable spectrum in the 700-MHz band, concluded Tuesday after nearly eight weeks with $19.6 billion in bids.

Democrat Edward Markey of Massachusetts, chairman of the House subcommittee on telecom and the Internet, said in a statement Tuesday that he is "eager to ascertain the extent to which new entrants have succeeded in obtaining licenses through this auction."

The FCC approved 214 companies, including Google, Verizon, and AT&T, to bid on 1,099 available licenses in five separate blocks, A through E. To prevent anti-competitive behavior, however, the identities of the bidders were kept secret during the process, and the winners have not yet been revealed.

"Providing new opportunities for competitive entry into the wireless marketplace and offering consumers greater choice is a key objective of wireless policy and for this auction in particular," Markey said.

Markey's subcommittee will soon hold a hearing to give members an opportunity to review the auction results, he said. The House is in recess until March 31, and the FCC is not likely to release the names of the winning bidders for several weeks, so the hearing will not likely occur until at least mid-April. Witnesses have not been named.

Markey also promised to evaluate why the d-block failed to attract any significant bids. Each block had a reserve price set by the FCC, and all but the d-block, which would have been designated for public safety had it earned at least $1.3 billion, met those targets. The d-block, however, failed to attract any bids beyond a $472 million opening bid.

It is widely believed that costly build-out requirements, the high reserve price, and a certain ambiguity as to how the winner would work with the public safety community dissuaded d-block bidders. Frontline Wireless, an entity that was looking to build a national network for emergency responders, was going to be the one footing the bill for D-block spectrum, but the group unexpectedly folded at the beginning of January.

It is now at the discretion of the FCC as to whether it will re-auction the d-block with public safety requirements at a lower reserve price, or strip public safety from the block entirely.

FCC Chairman Kevin Martin said in a statement Tuesday that the commission is "now evaluating its options for this spectrum," but said that the FCC "remains committed to ensuring that we work to solve public safety's interoperability challenges."

"I believe that any new auction for the 'd-block' should be consistent with an overarching policy goal of advancing public safety objectives and ultimately achieving a state-of-the-art, broadband infrastructure for first responders," Markey said.

He called on the FCC to analyze whether there really needs to be a high reserve price, and review things like the length of the license term, the build-out requirements and schedule of benchmarks for such build-out, the opportunities for ensuring further openness in wireless markets, and the penalties associated with failure to fulfill license conditions.

Martin "deserves credit for insisting that at least one of the major licenses contains this new openness as a condition of providing service," Markey said, referring to the c-block.

The FCC ruled that the c-block would have to be open to all devices and applications if it met a reserve price of $4.6 billion. It ended up attracted $6.5 billion in bids for its eight U.S.-based licenses.

Meanwhile, Steve Largent, president and CEO of CTIA, the wireless industry's trade association, said Tuesday that "the true winners in this auction will be American consumers" who will ultimately use services running on the newly available spectrum.

About the Author

Before joining PCMag.com, Chloe covered financial IT for Incisive Media in NYC and technology policy for The National Journal's Technology Daily in Washington, DC. She has held internships at NBC's Meet the Press, washingtonpost.com, the Tate Gallery press office in London, Roll Call, and Congressional Quarterly. She graduated with a bachelor's deg... See Full Bio

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